Tucson-based missile maker Raytheon Co. signed a new $1-billion multiyear deal for propulsion systems with California-based Aerojet Rocketdyne. The deal represents a supply chain centerpiece of multi-year Standard Missiles contracts Raytheon recently received. Raytheon says this deal allows it to save money in its supply chain, as it fulfills contracts with the Missile Defense Agency and U.S. Navy.

Raytheon Missile Systems’ Eugene Jaramillo says, “Moving to multi-year, rather than annual-year contracting enables Raytheon and its supply chain to deliver even more value to our Missile Defense Agency and U.S. Navy customers, and the taxpayer. “These multi-year agreements also allow our suppliers to transform the way they do business with Raytheon.”

Work on the programs will be spread across sites in Virginia, Arkansas, and Alabama. Raytheon produces missiles in Tucson and Huntsville. Earlier this year, Raytheon shifted the HQ of its new missiles and defense division to Tucson, and is expected to boost its Arizona employee base to 3,000.